In a bid to reposition its business for the long term, Panasonic plans to take its supply chain software business public.
The shares of Japanese multinational conglomerate company Panasonic Holdings Corp (TYO: 6752) were down in Tokyo at the time of writing as investors weigh in on the company’s conservative forecast for the current Financial Year (FY).
Panasonic Shares and Company’s Performance
The company reported an operating profit of 83.3 billion yen, a figure that is higher when compared with a profit of 31.8 billion yen a year earlier.
However, it fell short of the mean estimate of 85.5 billion yen profit from nine analysts surveyed by Refinitiv. While the growing incidence of the coronavirus pandemic and the ensuing lockdown in China has lent a high level of uncertainty to the financial landscape, Panasonic has given a humble projection of 360 billion yen in Operating Profits for the fiscal year ending in March 2023.
This figure is at least 5% below the 382.7 billion yen 20 analysts from Refinitiv were expecting. The share is down 1.86% to 1,134 yen.
Despite the share price outlook, Panasonic hit a lot of good numbers in the fourth quarter which has helped set the pace and its propensity for impressive business performance in the near-long term. However, the company is cautious with respect to the global business landscape and the complications that have been introduced by the ongoing war between Russia and Ukraine.
The global chip shortage also contributed in no small measure to the conservative forecast of the company in the long term. The impact of these broad economic uncertainties will be felt especially in Panasonic’s manufacturing business which includes its energy outfit that produces batteries for American electric vehicle production giant, Tesla Inc (NASDAQ: TSLA).
The company is hoping to overcome these challenges by building a new factory in the US that will specifically cater to Tesla’s new battery specifications (4680 format that is, 46 millimeters wide and 80 millimeters tall) which are 5 times larger than the current specifications. With Tesla pushing forth ambitious numbers in terms of its expected supply, Panasonic sees a very bullish business prospect ahead.
Panasonic Exploring Income Diversification Through Supply Chain Software
In a bid to reposition its business for the long term, Panasonic plans to take its supply chain software business public. The company believes the demand for supply chain management solutions will increase over the course of the next five years, and its supply in this industry will be well suited to benefit greatly.
The public listing move, according to a Reuters report, will also feature Blue Yonder, a US machine learning company it bought last year for $7.1 billion, bundled with other supply chain services operated by Panasonic. There is no certainty as to when these public listings will happen or on which stock exchange they will take place, and how much it plans to raise in general.